2HRS2GO: Why waste time with silly tickers?

Don't be surprised if someday you see BUYME wander across a stock ticker scroll bar.

The thought occurs in the wake of this week's initial public offering of MusicMaker.com, whose shares trade under the moniker HITS. It's merely the latest member of Cute Stock Moniker Club, whose ranks include GEEK (Internet America Inc.), CPU (CompUSA), or FON (Sprint Corp.), to name three that immediately come to mind.

Hard core traders may see the market an opportunity to take advantage of things like unreasonably large spreads and momentum swings on a chart of technical indicators, and long-term investors do the traditional work of examining a company's product line and looking at income statements and balance sheets. But looking at the action in some stocks, I wonder if there aren't a growing number of people who trade based entirely on ticker symbols that happen to catch their eye.

"It's only happening recently with the Internet bandwagon," says Mike Shokouhi, Nasdaq-Amex spokesman. "A lot of mistakes are made, and it's shame. It's a growing concern."

Have an opinion on this?

Shokouhi's talking about people mistaking one ticker symbol for another. During my time as a business reporter in upstate New York, not a week went by without fielding at least one, and often several, calls from readers who had the wrong ticker symbols for companies they wanted included in the newspaper's stock listings.

For that reason alone, having a distinctive abbreviation helps. But somewhere along the stock market's trek into infatuation with technology stocks, tickers seem to have become marketing tools. Given the flood of stocks nowadays, you can understand why companies might do whatever they can to grab your attention and hopefully, your investment dollars.

Once a company qualifies for the Nasdaq (we'll focus on that since most new technology offerings appear there nowadays) national market, applying for a ticker symbol is simple -- submit three choice in order of preference, and hope no one else already owns the one you really want. You can even claim tickers already in use, if they're being used by a small cap, over-the-counter stock. Size matters, after all.

(Perhaps MusicMaker.com should have seized something besides HITS, considering the symbol was associated with Hitsgalore.com Inc., a promoter of banner advertising through its "business search engine", and a company that seems caught up lately in defending itself against allegations of shady behavior. On the other hand, unlike MusicMaker, Hitsgalore makes money, at least on paper, so maybe HITS wasn't such a bad choice after all. In case you care, Hitgalore is itself angling for Nasdaq national listing, now under the symbol HITT)

People might be happier if the performance matched the attempts at cleverness. HITS has been retreating since Wednesday's debut. GEEK now trades at less than half of its all-time high, reached in late December less than a month after its IPO. CPU has been sliding for a year and a half as CompUSA retail chain continues to struggle in the face of direct sales. Even FON's share price growth of almost 40 percent over the past year -- a good performance by any reasonable standard -- suffers in comparison to the stock gains of its chief rivals, AT&T and MCI Worldcom.

Ticker symbols obviously have nothing to do with a stock's proper value, but people seem to trade that way -- how else to explain GEEK's rise to 50 back in December? Someone sees the funny symbol and buys a few shares on a kick, daytraders see the upward tick and immediately flood the message boards and drive the price higher, the momentum feeds itself into a frenzy, then someone at the top hits the "sell" button, triggers a slide, and at the end some unsuspecting retail investor finds himself stuck with a 20-point loss.

You can't protect people from their own silliness, and besides, there's no reason to feel sorry for people who don't do their own research. But being a naive bleeding heart, I'd like to think stupidity wouldn't lead to bankruptcy either.

Other issues:

Liquid Audio Inc.

(Nasdaq: LQID) With the music industry's current uproar about security, this company is in position to benefit, especially with its already impressive list of clients. But wait until the IPO buzz calms down and it drifts back to a more reasonable price.

Digital River Inc.

(Nasdaq: DRIV) The company's acquisition of Register Now! may seem minor, but one look at the statistics of popular shareware sites -- a popular application such as WS_FTP easily racks up hundreds of thousands of downloads -- tells you that it's large and uncharted industry. If even one percent of downloaders can be convinced to pay up, Digital River might make its money back on Register Now very quickly.

The overall market saw mild gains by mid-afternoon. With two hours left in this week's regular trading, the Nasdaq Composite Index was up 7.73 to 2779.78, the S&P 500 was higher 5.30 to 1399.72, and the Dow Jones Industrial Average was better by 46.86 to 11173.75. 22GO>